Down Payment for a House Impacts Home Affordability More Than Thought

Mortgage and Lending with Henry J Daniels (936) 228-1944 NMLS #209419

When looking to purchase a home you will see a lot of articles that focus on interest rate as the only factor in determining how affordable a home is for you.  What you're really looking for is "How much down payment for a house?" A recent Federal Reserve Board study on the factors that impact your home affordability debunks this.  (You can read the detailed study of how the down payment for a house affects home affordability here)

down payment for a houseThe Bottom line of this 52 page report put out by the New York Federal Reserve Board is that housing affordability among people who currently rent improves by a whopping 40% when down payment requirements are reduced.  However, a 2% difference in interest rates has only a 5% impact on housing affordability.

This is great news for many home buyers who qualify for some of the low doan payment programs available today in the mortgage market.

Also the recent news on home affordability index is at a new high means that you are in a great market to to purchase now before the summer price increases hit.

To get your prequalification started today just contact us or use our online home prequalification to get started.

To answer some questions here of "How much downpayment for a house?" lets cover some of the programs that are available in today's market.

Low down payment home loan programs

  • 3% home down payment - Conventional Home Loans Offer first time home buyers a down payment of 3%
  • 3.5% home down payment - FHA in most cases the down payment is 3.5% - This would be for existing homes and homes that need a little work using FHA's 203K program
  • 5% down Conventional Loans for Previous homeowners - 5% down will get you into a home.  Conventional have several advantages over FHA the biggest of which the mortgage insurance will go away when you have enough equity in the home.
  • 5% down for a Custom Home Construction loan will get you into a home that is custom built for your family

No downpayment home loan programs

  • VA - If you are a Veteran of the Armed Services of the United States you can get a VA home loan with nothing down
  • USDA - In certain areas and for those who qualify the USDA home loan offers no down payment home loans

So to answer your question How much downpayment for a house? the answer is not much.  Contact us today and we can get your or apply for your home prequalification for most any home in the US.

Posted by

Henry J Daniels, Senior National Mortgage Banker for Goldwater Bank N.A.  he specializes in educating clients on the new realities of today's mortgage lending market and providing solutions to all of your home financing needs.  

If you need Custom Home Construction, Rehab, FHA, VA, USDA, Conventional, Jumbo or Construction mortgage Nationwide he can help you understand all of the options available and provide you with true financing choices.  

You may contact him at (936) 228-1944

  Copyright © 2007-2018 Henry J Daniels

The views expressed are mine alone and do not necessarily reflect the views of any company I may work for.

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